The Ultimate Guide To Investing In Abandoned & Vacant Properties

The vacant property definition is straightforward; it simply means the property is sitting empty or abandoned.

Finding vacant property for sale can be as simple as driving different routes through your existing neighborhood.

For those interested in buying vacant property, it is important to nail down a strategy that works best for their business.

When it comes to a vacant property, beauty is often in the eye of the beholder. For neighbors, vacant properties may represent an eye sore. For savvy investors, on the other hand, a vacant property can represent a unique opportunity to land a deal. Even the most experienced investors often do not have experience working with vacant properties; however, if you know what to look for, this strategy might just land you some impressive deals. Keep reading to learn how to find vacant properties, and for more information on what to do when you find them.

What Is A Vacant Property And Why Should I Invest In One?

A vacant property is exactly that: vacant. The property is abandoned, and no one lives in it anymore. They can often be spotted by overgrown yards, notices on the windows, or damage to the outside of the house. In most situations involving a vacant property, the owner is separated from the home and no longer performs regular maintenance, hence the name vacant property.

If the houses are not in the best condition, you may be wondering “why should I do a vacant property search?” Well, the answer is easy: vacant property investing can offer numerous benefits to those willing to put the time in to search for them. While vacant properties may appear to require more deals than usual, they also often equate to highly motivated sellers. For investors looking to secure properties under market value, a vacant property may lead to a great deal.

Investors may also be excited to learn that vacant properties can also offer unconventional financing methods, such as seller financing. This is especially appealing to investors who do not have the highest credit score. Owners of vacant properties are often more than willing to let the property go; therefore, they may be more accommodating of your financial history.

The reason most investors do not go after vacant houses is not because they don’t offer unique opportunities (they do), but because more often than not investors are unaware of the scope of benefits associated with the strategy. Knowing how to invest in a vacant property can often give a leg up to investors, especially those operating within competitive markets.

Buying Vacant Property: 4 Things You Need To Know

When it comes to buying vacant property, the first thing to note is that a vacant property has the potential to encounter a few more problems than usual. Since the property is sitting vacant, there may be damage from bugs, mice, or even vandalism. While these issues could create a small speed bump for your investment deal, they should instead be thought of as factors that would increase the likelihood of a sale from the owner’s point of view.

Similarly, vacant properties, like any, demand upkeep. As I have already pointed out, they may fall victim to a number of issues simply by sitting untouched over a given period of time. Depending on the amount of time a property has been vacant, sellers may not even realize how much upkeep should be going into the home. For those wondering how to buy a vacant property, consider the seller’s motivation: they may be ready to part ways with the home because of their current holding costs.

When it comes to vacant property insurance, there is some grey area. Homeowners will often believe that any damage done to a vacant property is covered under their traditional homeowners insurance. However, this is not the case. Homeowners insurance typically requires the property to be occupied in order for claims to be made. This information can be used to your advantage, as property owners are often even more willing to part with a property after learning it has the potential to be a liability.

Finally, you may have varied luck when searching for vacant properties. In the beginning of your search you may find that you encounter vacant properties often; however, some days you may struggle to find any leads at all. The reason buying vacant properties is not a more well known strategy among real estate investors is that they are slightly misunderstood. That being said, finding vacant properties isn’t more or less difficult than finding regular leads; it can just take a little more time to identify which properties in your area are worth pursuing.

Financing Vacant Rental Properties

Vacant properties don’t just apply to residential real estate. In your investing career you may encounter a vacant rental property or even a vacant commercial property, and in those situations it is key to have a system in place to ensure you understand how to move forward. Vacant rental property listings may not come around often, but when they do, they can represent a unique opportunity for building wealth.

When it comes to vacant property, you are more often than not going to be working with motivated sellers. In most instances, property owners may not even know they are classified as a motivated seller, despite all the signs being present. That being said, seller financing can often come into play with a vacant property. In many cases, the owner of a vacant property has received notices from neighbors, the Department of Housing and Urban Development, and other agencies about leaving the property unoccupied. These factors, while unfortunate, can increase the seller’s flexibility when it comes to getting rid of the property.

How To Find Vacant Properties

By strategizing the best ways to identify abandoned properties, you can work your way towards a vacant property list of your own. Here are several tactics you can employ to make your search a little easier:

The number one way to find vacant houses is simply to drive around your area. You would be surprised how often you come across vacant properties in your own neighborhood. You don’t need to drive around for hours to find vacant properties. Instead, one of the best ways to find vacant homes is to mix up the routes you usually take in favor of new drives. When driving, keep a lookout for the tell tale signs of a vacant property, and you might be surprised how many you find.

When looking for vacant properties, you can also reach out to local postal workers. Vacant properties will receive notices from the post office to no longer receive mail so that it does not pile up, meaning post office employees often know exactly where these houses are. I am not suggesting you show up on your local worker’s route, but you could contact a local post office in your area for a better idea of where to start.

Another way to boost your vacant property search, often times before a property ever becomes vacant, is by researching estate sales. It may be worth your time to make note of the address so you can search the owner names. With this information, you may be able to find the owner’s contact information and inquire about the state of the property.

Advertising is also a great way to find vacant properties. Neighbors around a given property may be eager to provide information in the hopes that the property be taken care of. For this reason, investors who employ their usual advertising techniques with the added focus of finding vacant properties may have good luck finding them through advertising.

How To Find Vacant Property Owners

Now that you have a good idea of finding vacant properties, you may be wondering how to identify their owners. This is where you may have to do a little digging. These are some of my best tips for learning how to find vacant property owners:

One way to find the owner of a vacant property is to leave a note on the house, or in the mailbox. Now, I know what you’re thinking: if the property is vacant it is unlikely the note will ever be seen. You may be right, but when it comes to finding the owner of an abandoned property, it can be helpful to exercise all of your options.

Another effective method for finding the owner of a vacant property is to ask the neighbors around the house. More often than not, they will be able to provide more information than what you have. You should take extra care when reaching out to anyone regarding a vacant property, and make sure you are clear in your communication that you are interested in buying the property. Helpful neighbors may be able to point you in the right direction.

Checking the tax records of a given property is another tried and true method for identifying the owner of a vacant property. You can even use tax records to determine the owner’s current address and send them a letter asking if they are interested in selling the vacant property in question.

Investing in vacant properties can offer a variety of benefits for savvy real estate investors. Searching for vacant properties is a great way to expand your efforts with unconventional forms of real estate investing, while still employing tactics you would use in your everyday business. You may have to spend a little more time searching for the properties and their owners, but if a vacant property deal goes as planned, you may find success using this investing strategy.

Have you ever invested in a vacant property? Let us know how the process went in the comments below.

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